European stocks got a leg up from an unexpectedly positive German business outlook, even as Portugal's debt rating was cut to junk.
Britain's FTSE 100 rose 0.6 per cent, France's CAC 40 gained 1.7 per cent, and Germany's DAX gained 1.7 per cent.
U.S. markets were closed for the Thanksgiving Day holiday.
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Japan's Nikkei index ended 1.8 per cent lower, while Hong Kong's Hang Seng gained 0.4 per cent.
Germany was the source of market consternation on Wednesday, when its bond auction failed. On Thursday, market sentiment improved after the Ifo Institute's monthly confidence index rose slightly to 106.6 in November from 106.4 the previous month. Analysts had expected a fifth consecutive decline.
Investors largely shrugged off a decision by Fitch, one of the three leading credit rating agencies, to cut Portugal's credit rating to junk, citing "large fiscal imbalances, high indebtedness across all sectors, and adverse macroeconomic outlook."
The euro recovered from steep falls against the dollar, trading near $1.3370 (U.S.) after hitting a seven-week low on Wednesday.
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Gold rose above $1,700 an ounce after its decline to one-month lows this week triggered some bargain hunting.
Copper gained, lifting off a one-month low hit earlier in the session, but prices are still on track for a fourth straight week of losses. Three-month copper on the London Metal Exchange traded at $7,280 a tonne, up 0.7 per cent from $7,240 per tonne at the close on Wednesday.
Brent crude rose 54 cents to $107.56 a barrel. U.S. crude gained 53 cents at $96.70 a barrel. Trading volume is expected to remain thin as the U.S. market is closed.
The Canadian dollar traded at 95.74 U.S. cents.